Azeri protests flag political risks of falling oil price

QUBA, Azerbaijan, Jan 18 (Reuters) - Oil money and
well-equipped security forces have long ensured public loyalty
to President Ilham Aliyev in the Azeri town of Quba, but after
months of rising prices people turned out on the streets last
week to protest.

Dragged down by the slump in world crude prices,
Azerbaijan's manat currency has fallen by about a third against
the dollar in the past 30 days, sparking public protests that
could be a taste of unrest to come for other oil-funded
economies.

It has prompted Aliyev to consider such measures as
tightening currency controls, helping banks, and selling off
state assets.

But the anger is mounting.

"Prices are rising, officials are corrupt, there are no
jobs, we can't pay off credits," said 28-year-old Afqan, sitting
in an empty tea shop in the centre of Quba, in the foothills of
the Caucasus mountains.

Police have mobilised police in large numbers to stop such
protests spreading in a year when Aliyev has courted publicity
by securing the right to host the international Formula 1 motor
race.

"Our protest was not organised ... We did not have a leader,
but about 5,000 people came and protested, because we could not
tolerate it any more," Afqan said.

After prayers in the mosques on Friday evening, people in
Quba gathered in the main square of the town, 180 kilometres
(110 miles) to the north of the capital Baku. The gathering was
quickly broken up by riot police, who used water cannons, batons
and tear gas. About 50 protesters were beaten and detained,
witnesses said.

A day later, several heavily-armoured riot policemen were
still standing in the town's centre, while additional police
forces were stationed in buses nearby.

"The authorities are afraid of us, they are afraid that
these small local protests may transform into something big,"
said Rustam, a 25-year-old resident of Quba, who also
participated in the protest.

"We have nothing to lose, you know ... Those who are already
wet are not afraid of rain."

PRESTIGE PROJECTS

Aliyev is firmly entrenched in office, helped by powers of
patronage and well-equipped security forces, and there were no
signs of any immediate threat to his hold on power.

Since he was elected to succeed his father Heydar Aliyev as
president in a 2003 vote, he has overseen some of the fastest
rates of economic growth in the world, at an average of 21
percent per year between 2003 and 2007.

Supporters say he has brought stability, modernisation and
closer ties with Europe. Prestige projects have included hosting
the Eurovision song contest in 2012 and the inaugural European
Games last year.

But while the economy was flourishing, allegations of
curbing freedoms and silencing dissent gained little traction.

Now the fall in the oil price has brought Azerbaijan's
problems to the surface, not least its widespread corruption.
Transparency International places Azerbaijan at 126 out of 174
countries in its global corruption ranking.

Quba, in an agricultural region near the border with Russia,
is relatively well-off. A mountainous landscape makes it a
tourist destination with hotels including an expensive Rixos.

Yet people in the town allege that customs officers demand
bribes to let local exports of fruit and vegetables cross over
the border into Russia.

A protest similar to the one in Quba erupted last week in
Siyazan, a town 90 kilometres from Baku. It too was broken up by
police. Residents say dozens of people were detained there.

At the weekend, all entries to Siyazan were guarded by
police, although there are no visible signs of their presence
within this small town.

"We lost our last hope," one resident, who declined to give
his name for fear of the authorities, said of the aborted
protest in Siyazan.

"But what can our small region do alone? If other regions
also join the protest, we will be able to change something."
(Editing by Christian Lowe and Ruth Pitchford)